Project leads at the decentralized crypto exchange PancakeSwap on Tuesday proposed lowering the inflation rate target for its native CAKE token to 3-5%, a drastic cut from its current rate above 20%.

Inflation in this context refers to growth in the supply of a token; lower inflation could lead to higher token prices, based on the rules of supply and demand.

The “version 2.5” tokenomics proposal would move CAKE toward a “deflationary model” by slashing the token rewards paid to traders and stakers by over 68%. The so-called CAKE “emissions” on Syrup Pool, PancakeSwap’s main liquidity pool on BNB Smart Chain, would drop by 94% under the proposal.

(by Nick Baker)